Climate chaos has gone to new extremes this summer, with Pakistan drowning in unprecedented floods due to the melting of the snow capped Himalayas, Russia cooking at 110 degrees, and an iceberg four times the size of Manhattan breaking off the top of northern Greenland. See Democracy Now!’s coverage of these climate catastrophes.

Unprecedented floods in Pakistan have killed thousands and displaced over 1 million. These catastrophes will become more common as global warming worsens.

Why hasn’t the U.S. Congress done anything to stop global warming? The answer is capitalism. As the new website DirtyEnergyMoney.com documents, the oil and coal industries have spent over $100 million in the past decade to buy congressmen and stop legislation that threatens their profit margins. The environmental movement therefore faces a crossroads: continue to compromise and waste time talking to corrupt Senators, or go out to the streets and organize people for more radical solutions. Bill McKibben, one of the most respected voices in environmentalism, says: time for Plan B. [alex]

We’re Hot as Hell and We’re Not Going to Take It Any More
Three Steps to Establish a Politics of Global Warming

* According to the National Oceanic and Atmospheric Administration, the planet has just come through the warmest decade, the warmest 12 months, the warmest six months, and the warmest April, May, and June on record.

* A “staggering” new study from Canadian researchers has shown that warmer seawater has reduced phytoplankton, the base of the marine food chain, by 40% since 1950.

* Nine nations have so far set their all-time temperature records in 2010, including Russia (111 degrees), Niger (118), Sudan (121), Saudi Arabia and Iraq (126 apiece), and Pakistan, which also set the new all-time Asia record in May: a hair under 130 degrees. I can turn my oven to 130 degrees.

* And then, in late July, the U.S. Senate decided to do exactly nothing about climate change. They didn’t do less than they could have — they did nothing, preserving a perfect two-decade bipartisan record of no action. Senate majority leader Harry Reid decided not even to schedule a vote on legislation that would have capped carbon emissions.

I wrote the first book for a general audience on global warming back in 1989, and I’ve spent the subsequent 21 years working on the issue. I’m a mild-mannered guy, a Methodist Sunday School teacher. Not quick to anger. So what I want to say is: this is fucked up. The time has come to get mad, and then to get busy.

For many years, the lobbying fight for climate legislation on Capitol Hill has been led by a collection of the most corporate and moderate environmental groups, outfits like the Environmental Defense Fund. We owe them a great debt, and not just for their hard work. We owe them a debt because they did everything the way you’re supposed to: they wore nice clothes, lobbied tirelessly, and compromised at every turn.

By the time they were done, they had a bill that only capped carbon emissions from electric utilities (not factories or cars) and was so laden with gifts for industry that if you listened closely you could actually hear the oinking. They bent over backwards like Soviet gymnasts. Senator John Kerry, the legislator they worked most closely with, issued this rallying cry as the final negotiations began: “We believe we have compromised significantly, and we’re prepared to compromise further.”

And even that was not enough. They were left out to dry by everyone — not just Reid, not just the Republicans. Even President Obama wouldn’t lend a hand, investing not a penny of his political capital in the fight.

The result: total defeat, no moral victories.

Now What?

So now we know what we didn’t before: making nice doesn’t work. It was worth a try, and I’m completely serious when I say I’m grateful they made the effort, but it didn’t even come close to working. So we better try something else. Read the rest of this entry »

At just 27 years old, Alex is already an accomplished writer and a full time activist for social justice. His site, The End of Capitalism, explores the theory of the unsustainable nature of a profit-driven global system that continues to exploit all of the earth’s resources for the sake of greed and power.

Having grown up in Ambler, Pennsylvania — the ‘Asbestos Capital of the World’ — Alex saw first hand the devastation of his home town through the greed of Keasbey and Mattison Corporation who continued to manufacture Asbestos through the 1970s despite the evidence that had existed for years that Asbestos causes Mesothelioma, a serious form of Lung Cancer.

Seeing the sickness of his community first hand eventually built the foundation for Alex’s future environmental and social activism. While at Lehigh University studying Electrical Engineering, Alex became more intellectually aware of the systemic patterns of exploitation and human/environmental devastation brought on by a long history of a Capitalist system concerned only with profit. Alex went on to get his Master’s in Political Science from Lehigh and now is a full-time activist in the Philadelphia area fighting for real and meaningful progressive change.

As Alex will tell you, there is nothing extraordinary about him. Being the quintessential “All American Boy” — he was born on the 4th of July — Alex discovered that real social change is ameliorated when we decide to join forces and fight the powers that are determined to keep us placated and in a constant state of fear so we will not question our own imprisonment of thought and continue to consume without thought or premeditation. For Alex, grassroots organizing and activism is the key to a sustainable future and when we define ourselves as left, right, Marxist, Anarchist, etc.. we just perpetuate petty semantic divides. Alex is proud to call himself “Progressive” as he is a tireless fighter for justice.

The following exchange between Michael Carriere and Alex Knight occurred via email, July 2010. Alex Knight was questioned about the End of Capitalism Theory, which states that the global capitalist system is breaking down due to ecological and social limits to growth and that a paradigm shift toward a non-capitalist future is underway.

This is the final part of a four-part interview. Scroll to the bottom for links to the other sections.

Part 3. Life After Capitalism

MC: Moving forward, how would you ideally envision a post-capitalist world? And if capitalism manages to survive (as it has in the past), is there still room for real change?

AK: First let me repeat that even if my theory is right that capitalism is breaking down, it doesn’t suggest that we’ll automatically find ourselves living in a utopia soon. This crisis is an opportunity for us progressives but it is also an opportunity for right-wing forces. If the right seizes the initiative, I fear they could give rise to neo-fascism – a system in which freedoms are enclosed and violated for the purpose of restoring a mythical idea of national glory.

I think this threat is especially credible here in the United States, where in recent years we’ve seen the USA PATRIOT Act, the Supreme Court’s decision that corporations are “persons,” and the stripping of constitutional rights from those labeled “terrorists,” “enemy combatants”, as well as “illegals.” Arizona’s attempt to institute a racial profiling law and turn every police officer into an immigration official may be the face of fascism in America today. Angry whites joining together with the repressive forces of the state to terrorize a marginalized community, Latino immigrants. While we have a black president now, white supremacist sentiment remains widespread in this country, and doesn’t appear to be going away anytime soon. So as we struggle for a better world we may also have to contend with increasing authoritarianism.

I should also state up front that I have no interest in “writing recipes for the cooks of the future.” I can’t prescribe the ideal post-capitalist world and I wouldn’t try. People will create solutions to the crises they face according to what makes most sense in their circumstances. In fact they’re already doing this. Yet, I would like to see your question addressed towards the public at large, and discussed in schools, workplaces, and communities. If we have an open conversation about what a better world would look like, this is where the best solutions will come from. Plus, the practice of imagination will give people a stronger investment in wanting the future to turn out better. So I’ll put forward some of my ideas for life beyond capitalism, in the hope that it spurs others to articulate their visions and initiate conversation on the world we want.

My personal vision has been shaped by my outrage over the two fundamental crises that capitalism has perpetrated: the ecological crisis and the social crisis. I see capitalism as a system of abuse. The system grows by exploiting people and the planet as means to extract profit, and by refusing to be responsible for the ecological and social trauma caused by its abuse. Therefore I believe any real solutions to our problems must be aligned to both ecological justice and social justice. If we privilege one over the other, we will only cause more harm. The planet must be healed, and our communities must be healed as well. I would propose these two goals as a starting point to the discussion.

How do we heal? What does healing look like? Let me expand from there.

Five Guideposts to a New World

I mentioned in response to the first question that I view freedom, democracy, justice, sustainability and love as guideposts that point towards a new world. This follows from what I call a common sense radical approach, because it is not about pulling vision for the future from some ideological playbook or dogma, but from lived experience. Rather than taking pre-formed ideas and trying to make reality fit that conceptual blueprint, ideas should spring from what makes sense on the ground. The five guideposts come from our common values. It doesn’t take an expert to understand them or put them into practice.

In the first section I described how freedom at its core is about self-determination. I said that defined this way it presents a radical challenge to capitalist society because it highlights the lack of power we have under capitalism. We do not have self-determination, and we cannot as long as huge corporations and corrupt politicians control our destinies.

I’ll add that access to land is fundamental to a meaningful definition of freedom. The group Take Back the Land has highlighted this through their work to move homeless and foreclosed families directly into vacant homes in Miami. Everyone needs access to land for the basic security of housing, but also for the ability to feed themselves. Without “food sovereignty,” or the power to provide for one’s own family, community or nation with healthy, culturally and ecologically appropriate food, freedom cannot exist. The best way to ensure that communities have food sovereignty is to ensure they have access to land.

Ella Baker championed the idea of participatory democracy

Similarly, a deeper interpretation of democracy would emphasize participation by an individual or community in the decisions that affect them. For this definition I follow in the footsteps of Ella Baker, the mighty civil rights organizer who championed the idea of participatory democracy. With a lifelong focus on empowering ordinary people to solve their own problems, Ella Baker is known for saying “Strong people don’t need strong leaders.” This was the philosophy of the black students who sat-in at lunch counters in the South to win their right to public accommodations. They didn’t wait for the law to change, or for adults to tell them to do it. The students recognized that society was wrong, and practiced non-violent civil disobedience , becoming empowered by their actions. Then with Ms. Baker’s support they formed the Student Non-violent Coordinating Committee (SNCC) and organized poor blacks in Mississippi to demand their right to vote, passing on the torch of empowerment.

We need to be empowered to manage our own affairs on a large scale. In a participatory democracy, “we, the people” would run the show, not representatives who depend on corporate funding to get elected. “By the people, for the people, of the people” are great words. What if we actually put those words into action in the government, the economy, the media, and all the institutions that affect our lives? Institutions should obey the will of the people, rather than the people obeying the will of institutions. It can happen, but only through organization and active participation of the people as a whole. We must empower ourselves, not wait for someone else to do it. Read the rest of this entry »

The following exchange between Michael Carriere and Alex Knight occurred via email, July 2010. Alex Knight was questioned about the End of Capitalism Theory, which states that the global capitalist system is breaking down due to ecological and social limits to growth and that a paradigm shift toward a non-capitalist future is underway.

This is the second part of a four-part interview. Scroll to the bottom for links to the other sections.

Part 2A. Capitalism and Ecological Limits

MC: Capitalism has faced many moments of crisis over time. Is there something different about the present crisis? What makes the end of capitalism a possibility now?

AK: This is such an important question, and it’s vital to think and talk about the crisis in this way, with a view toward history. It’s not immediately obvious why this crisis began and why, two years later, it’s not getting better. Making sense of this is challenging. Especially since knowledge of economics has become so enclosed within academic and professional channels where it’s off-limits to the majority of the population. Even progressive intellectuals, who aim to translate and explain the crisis to regular folks, too often fall into the trap of accepting elite explanations as the starting point and then injecting their politics around the edges. This is why there is such an abundance of essays and videos analyzing “credit default swaps”, “collateralized debt obligations,” etc., as if this crisis is about nothing more than greedy speculators overstepping their bounds.

On the contrary, the End of Capitalism Theory insists there are deeper explanations for why this crisis is so severe, widespread, and long-lasting. Here’s one explanation: The devastating quaking of the financial markets, and the lingering aftershocks we’re experiencing in layoffs and cut-backs, are manifestations of much larger tectonic shifts under the surface of the economy. This turmoil originates from deep instabilities within capitalism, the global economic system that dominates our planet. The dramatic crisis we are experiencing now is resulting from a massive underground collision between capitalism’s relentless need for growth on one side, and the world’s limited capacity to sustain that growth on the other.

These limits to growth, like the continental plates, are enormous, permanent qualities of the Earth – they cannot be ignored or simply moved out of the way. The limits to growth are both ecological, such as shortages of resources, and social, such as growing movements for change around the globe. As capitalism rams into these limiting forces, numerous crises (economic, energy, climate, food, water, political, etc.) erupt, and destruction sweeps through society. This collision between capitalism and its limits will continue until capitalism itself collapses and is replaced by other ways of living.

Tectonic Plates Colliding - Capitalism is Ramming into the Limits to Growth, Causing Massive Shocks on the Surface of the Economy

The End of Capitalism Theory argues that capitalism will not be able to overcome these limits to growth, and therefore it is only a matter of time before we are living in a non-capitalist world. A paradigm shift towards a new society is underway. There’s a chance this new future could be even worse, but I hold tremendous hope in the capacity of human beings to invent a better life for themselves when given the chance. Part of my hope springs from the understanding that capitalism has caused terrible havoc all over the world through the violence it perpetrates against humanity and Mother Earth. The end of capitalism need not be a disaster. It can be a triumph. Or, perhaps, a sigh of relief.

Defining the Crisis

Rather than spend our time learning the language of Wall St. and trying to understand the economic crisis from the perspective of the bankers and capitalists, I think we can get much further if we take our own point of reference and then investigate below the surface to try to find the true origins of the crisis. This is what I call a common sense radical approach. Start from where we are, who we are, and what we know, because you don’t need to be an academic to understand the economy – you just need common sense. Then try to get to the root of the issue (radical coming from the Latin word for “root”). What is really going on under the surface? What is the core of the problem? If we can’t come up with a common sense radical explanation of the crisis, we’ll always be stuck within someone else’s dogma. This could be Wall St. dogma, Marxist dogma, Christian dogma, etc. So what is this crisis really about? Read the rest of this entry »

The tar sands are an abomination. In a desperate move to counteract peak oil, Canada and the United States are waging war on Alberta’s ecosystem and indigenous communities, as well as on the planet as a whole. This crime must be stopped.

Clayton Thomas-Muller also recently spoke on Democracy Now!, see the video. [alex]

greenpeace.org

Tar Sands: The World’s Largest Climate Crime
By Clayton Thomas-Muller

Often when one looks at the global climate crisis and the critical necessity of forests as carbon storehouses, we have visions of the Amazon rainforest in South America, or the vast rainforest cover in places like Malaysia, Indonesia, across south East Asia and Africa. What many don’t envision is the second largest carbon storehouse on Mother Earth located in Canada’s northern region known as the Boreal Forest.

This soggy, wet, biologically diverse region spreads across the continent east to west. It is home to hundreds of First Nations/Indigenous communities that have utilized these ecologically diverse regions for their livelihood from time immemorial. Many also do not know that the Boreal Forest is second only to the Amazon region in terms of daily forest loss due to industrial expansion. This tree loss is further exacerbated by an infestation of the spruce pine beetle, brought on by milder winters in the north, which has been destroying millions of hectares of trees from southeast Alaska all the way to western Alberta.

Also found beneath the pine-covered ground are vast stores of minerals and fossil fuel deposits, the most famous of which is known as Canada’s Athabasca Tar Sands in Northern Alberta. Second only to Saudi Arabia in terms of recoverable oil reserves, Canada’s tar sands have an estimated 177 billion barrels of recoverable oil. The main difference between these two sources is the fact that the tar sands in Canada are not a conventional form of oil; they are a tarry clay and sand like mixture that at room temperature is hard as a hockey puck.

To remove this oil, one of two methods must be used. The first is surface mining, where industry removes the top layer of muskeg, trees, clay and sand as well as lakes, streams and even rivers to depths of up to 300 feet. They then use the world’s largest steam shovels, earth movers and dump trucks (300 tons per load) to strip mine out the mix that is then hauled off to industrial upgrader facilities and processed into synthetic oil. In the end it works out to around 5 tons of earth for every barrel of oil. Every day they move enough earth to fill the famous home of the Toronto Blue Jays, the Rogers Sky Dome.

ran.org

If the deposits are more than a depth of 300 feet, producers must use a deep well injection process called “In Situ” or Steam Assisted Gravity Drainage (SAG-D). This process is six times more carbon and water intensive then conventional oil extraction. The industry must also utilize vast amounts of natural gas to superheat fresh water to be injected into Mother Earth to “melt” the bitumen that then is sucked out of the ground with uptake pipes for upgrading.

Thanks to the 600 million cubic feet of natural gas is burned every day for this type of extraction, the tar sands is the single largest source of carbon dioxide emissions in Canada, and the primary reason Canada is not fulfilling its legally binding emission reduction targets under the Kyoto Protocol. By 2030 at the current rate of expansion, the tar sands will be responsible for an emission level between 100-187 million tons of CO2 every year.

Probably most disturbing part of this extraction process are the runoff streams created by the use of water in the separation process. Once water is no longer usable it is dumped into a vast network of ten tailings ponds that can be seen from outer space. Every day these tailings ponds leak eleven million liters of contaminated water into the Athabasca River and ground water in the surrounding area. By the year 2030 if the tar sands continue to grow at the current rate of expansion these tailings ponds volume combined will represent a body of water as large as Lake Ontario.

Frontline Nightmares

As a result of this “Tarmageddon,” many local Indigenous communities have seen an increase in the presence of deadly forms of cancers and other autoimmune diseases in their populations. Many have observed the negative effects on critical traditional food sources such as the fish, moose, muskrat, beaver and plants that they depend on for sustenance and cultural needs. Moose have been found to have levels of arsenic 400 times the acceptable level as well as sores and tumors. Muskrat have been found with bloody noses and their homes smelling of petroleum. Fish with lesions and deformities are a common thing for fisherman in the region. The effect this has on First Nations/Indigenous communities is amplified when considering our fundamental connection to the sacredness of Mother Earth expressed through our reliance on traditional hunting, fishing and gathering practices. Read the rest of this entry »

Yesterday CNN broke the story that BP is dumping toxic dispersant Corexit 9500 into the Gulf in order to sink the oil under the surface, hiding the true size of the spill and therefore reducing their financial liability. In other words, instead of cleaning up the horrible mess they’ve made, BP has decided to try to hide the disaster as much as possible so they won’t need to pay for it.

Such outrageous corporate irresponsibility perfectly illustrates of how capitalism’s obsession with profits necessarily leads to ecological and social trauma. BP is forced by the stock market to concentrate all their efforts on increasing their bottom line and limiting losses, even if it means driving more oil underwater and away from the cleanup crews.

We need to move to a world where marine life, biodiversity, as well as human health and well-being are valued as more important than a corporation’s profit margin. It fills me with great anger and frustration for every daily tragedy that we have to suffer at the hands of this monstrous system. Even the slightest amount of rationality or simple human empathy would prevent these kinds of machine-brained crimes against the Earth if they were allowed to intervene.

Anderson Cooper talked to Fred McCallister, an investment banker with Allegiance Capital Corporation, who is going to be testifying before the Senate Commerce, Science and Transportation Committee today about something that’s appeared painfully obvious to me for some time now, that BP is using dispersants to hide the size of the oil spill in the hopes if limiting their liability. My only question is why has the government allowed them to do it?

ANDERSON COOPER: Fred McCallister joins us now.

Fred, why do you think that BP would prefer to use dispersants over skimmers?

The issue that BP is facing right now is whether to use what’s practices that are normal around the world, which is to try to cause the oil to come to the surface, and then deploy the right amount of equipment and the right type of equipment to gather that oil up and get it out of the Gulf.

Using the dispersants allows the oil to stay under the surface, and this accomplishes several purposes. It allows the — it makes it a lot more difficult to quantify the amount of oil that’s coming out, which has a direct impact on damages and royalties that have to be paid.

It keeps it out of sight and out of mind. And it allows BP to amortize the cost of the cleanup over several years, 10 to 15 years, because some of this oil is going to biodegrade, but a lot of that oil is going to roll up on the beaches for 10 or 15 years.

And if they can amortize that over 10 or 15 years,as opposed to dealing with that over the next 15 months, that’s a much better financial position for BP to be in. Read the rest of this entry »

Just two weeks after the Massey Energy coal explosion on April 5 that killed 29 miners in West Virginia, the BP oil rig Deepwater Horizon exploded in the Gulf of Mexico, killing 11 more workers. These back-to-back tragedies have brought attention to the fossil fuel industry’s terrible safety record – in both cases there were known safety violations on site, but the government did nothing to prevent disaster from occurring. See the interview below which explains how the federal government approved this BP rig and many more without conducting the environmental review they are legally obligated to.

Unlike the industry executives attempting to shift blame and avoid responsibility, we must look beneath the surface to discover the deeper meaning of these horrible crises.

Is the universe giving us a warning that fossil fuels are going to destroy us? Because if global climate change continues at the rate it has, in the not-too-distant future we will see many thousands, or even millions more deaths as crops dry up, floods destroy coastal wetlands, and diseases migrate to temperate regions. This is no joke. Families and communities are being destroyed so coal and oil corporations can boost their profit margins.

We need to be open to hearing the lessons that are all around us, especially from those who have been silenced and beaten down by capitalism.

Immediately after the Massey explosion and the BP explosion, was Earth Day – April 22. And on this date, indigenous and poor people from around the globe were meeting in Cochabamba, Bolivia for the World People’s Conference on Climate Change, a grassroots response to the corporate fraud that was the Copenhagen Summit. Bolivian President Evo Morales, who was proclaimed “World Hero of Mother Earth” by the United Nations General Assembly in October, hosted the conference, proclaiming “The capitalist system looks to obtain the maximum possible gain, promoting unlimited growth on a finite planet. Capitalism is the source of asymmetries and imbalance in the world.”

30,000 people from 140 countries convened and approved the “Cochabamba Protocol”, which calls for an International Climate Justice tribunal to prosecute climate criminals, and condemns REDDs which put a price on wild forests and encourage development, along with carbon market schemes. The protocal proposes a Universal Declaration of Mother Earth and demands that industrialized polluting nations cut carbon emissions by 50 percent as part of a new, binding climate agreement.

Global momentum is building towards confronting capitalism in terms of the ecological devastation it is causing. Here in the United States, Rising Tide North America is calling for a “Day of Action, Night of Mourning” this Friday, May 14 to call for BP to pay for all cleanup and long-term ecological effects of their spill, for the abolition of offshore oil drilling, and for “a rapid and just transition away from fossil fuels.”

[alex]

Government Exempted BP from Environmental Review

JUAN GONZALEZ: Well now to the Gulf of Mexico where the enormous oil slick in the Gulf continues to expand. Interior Secretary Ken Salazar has ordered a 3-week halt to all new offshore drilling permits. Emphasizing that the companies involved had made “major mistakes,” Salazar spoke to reporters Thursday outside BP’s Houston crisis center. He noted that lifting the moratorium on new permits will depend on the outcome of a federal investigation over the Gulf spill and the recommendations to be delivered to President Obama at the end of the month.

SECRETARY KEN SALAZAR: Minerals Management Service will not be issuing any permits for the construction of new offshore wells. That process will be concluded here on May the 28th. At that point in time, we’ll make decisions about how we plan on moving forward. There is some very major mistakes that were made by companies that were involved. But today is not really the day to deal with those issues. Today and the days ahead really are about trying to get control of the problem.

JUAN GONZALEZ: Secretary Salazar added that the existing offshore oil and natural gas drilling will continue, even as public meetings to discuss new oil drilling off the Virginia coast have been canceled for this month.

AMY GOODMAN: Salazar’s announcement comes on the heel of a Washington Post exposé revealing that the Minerals Management Service had approved BP’s drilling plan in the Gulf of Mexico without any environmental review. The article notes that the agency under Secretary Salazar had quote “categorically excluded” BP’s drilling as well as hundreds of other offshore drilling permits from environmental review. The agency was able to do this using a loophole in the National Environmental Policy Act created for minimally intrusive actions like building outhouses and hiking trails. Well, for more on this story, we’re joined now from Tucson, Arizona by Kieran Suckling, executive director of the Center for Biological Diversity. Welcome to DEMOCRACY NOW!, Kieran. Explain this loophole, how you found it, and what it means for the Gulf.

KIERAN SUCKLING: Well, when a federal government is going to approve a project, it has to go through an environmental review. But for projects that have very, very little impact like building an outhouse or a hiking trail, they can use something called a categorical exclusion and say there’s no impact here at all so we don’t need to spend energy or time doing a review. Well, we looked at the oil drilling permits being issued by the Minerals Management Service in the Gulf, and we were shocked to find out that they were approving hundreds of massive oil drilling permits using this categorical exclusion instead of doing a full environmental impact study. And then, we found out that BP’s drilling permit—the very one that exploded—was done under this loophole and so it was never reviewed by the federal government at all. It was just rubber-stamped. Read the rest of this entry »

This post was sparked after reading Richard Heinberg’s recent article Life After Growth, which is a much more personal introspection of Richard’s story uncovering the realities of peak oil and the limits to growth. I recommend that one, but this earlier essay he wrote on the “End of Growth” I believe may go down in history as required reading.

In it he asks what are the fundamental reasons behind the ongoing economic crisis, arguing persuasively that the role of ecological limits like peak oil cannot be ignored as inhibiting growth both in the long term as well as the short. However, what Richard lacks is an integrated analysis of the social limits to growth, especially the power of social movements all over the globe working against this system of capitalism.

Without a deep appreciation for the rights of poor and exploited people, it is easy to make mistakes, as I believe Richard does in this essay with regards to immigration, for example. Further, without seeing the big picture of people’s resistance to capitalism and yearning for a new, non-growth, sustainable world, it is easy to lose hope. And in these difficult times, hope is our most important natural resource. [alex]

Everyone agrees: our economy is sick. The inescapable symptoms include declines in consumer spending and consumer confidence, together with a contraction of international trade and available credit. Add a collapse in real estate values and carnage in the automotive and airline industries and the picture looks grim indeed.

But why are both the U.S. economy and the larger global economy ailing? Among the mainstream media, world leaders, and America’s economists-in-chief (Treasury Secretary Geithner and Federal Reserve Chairman Bernanke) there is near-unanimity of opinion: these recent troubles are primarily due to a combination of bad real estate loans and poor regulation of financial derivatives.

This is the Conventional Diagnosis. If it is correct, then the treatment for our economic malady might logically include heavy doses of bailout money for beleaguered financial institutions, mortgage lenders, and car companies; better regulation of derivatives and futures markets; and stimulus programs to jumpstart consumer spending.

But what if this diagnosis is fundamentally flawed? The metaphor needs no belaboring: we all know that tragedy can result from a doctor’s misreading of symptoms, mistaking one disease for another.

Something similar holds for our national and global economic infirmity. If we don’t understand why the world’s industrial and financial metabolism is seizing up, we are unlikely to apply the right medicine and could end up making matters much worse than they would otherwise be.

To be sure: the Conventional Diagnosis is clearly at least partly right. The causal connections between subprime mortgage loans and the crises at Fannie Mae, Freddie Mac, and Lehman Brothers have been thoroughly explored and are well known. Clearly, over the past few years, speculative bubbles in real estate and the financial industry were blown up to colossal dimensions, and their bursting was inevitable. It is hard to disagree with the words of Australian Prime Minister Kevin Rudd, in his July 25 essay in the Sydney Morning Herald: “The roots of the crisis lie in the preceding decade of excess. In it the world enjoyed an extraordinary boom…However, as we later learnt, the global boom was built in large part…on a house of cards. First, in many Western countries the boom was created on a pile of debt held by consumers, corporations and some governments. As the global financier George Soros put it: ‘For 25 years [the West] has been consuming more than we have been producing…living beyond our means.'” (1)

But is this as far as we need look to get to the root of the continuing global economic meltdown?

A case can be made that dire events having to do with real estate, the derivatives markets, and the auto and airline industries were themselves merely symptoms of an even deeper, systemic dysfunction that spells the end of economic growth as we have known it.

In short, I am suggesting an Alternative Diagnosis. This explanation for the economic crisis is not for the faint of heart because, if correct, it implies that the patient is far sicker than even the most pessimistic economists are telling us. But if it is correct, then by ignoring it we risk even greater peril.

Economic Growth, The Financial Crisis, and Peak Oil

For several years, a swelling subculture of commentators (which includes the present author) has been forecasting a financial crash, basing this prognosis on the assessment that global oil production was about to peak. (2) Our reasoning went like this: Read the rest of this entry »

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